Statistics Canada reported on Wednesday the country’s consumer price index (CPI) fell 0.2 percent m-o-m in December, following a 0.1 percent m-o-m gain in the previous month. This was the first decline since September.

On the y-o-y basis, Canada’s inflation rate increased 0.7 percent last month after advancing 1.0 percent in November.

Economists had predicted inflation would be flat m-o-m and increase 1.0 percent y-o-y in December.

According to the report, consumer price growth slowed on lower air transportation prices (-14.5 y-o-y) and reduced food price growth (+1.1 percent y-o-y).

Meanwhile, the closely watched the Bank of Canada's core index rose 1.5 percent y-o-y in December, the same pace as in November.